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DECREE

On air transportation business and general aviation

THE GOVERNMENT

Pursuant to the December 25, 2001 Law on Organization of the Government;

Pursuant to the June 29, 2006 Law on Civil Aviation of Vietnam;

At the proposal of the Minister of Transport,

DECREES:

Chapter I

GENERAL PROVISIONS

Article 1.- Scope of regulation and subjects of application

1. This Decree specifies the conditions, order, procedures for the grant of air transportation business licenses, general aviation business licenses and general aviation registration certificates, agencies examining dossiers of application and agencies granting these licenses and certificates.

2. This Decree applies to all organizations and individuals involved in the grant of air transportation business licenses, general aviation business licenses and general aviation registration certificates.

Article 2.- Scope of air transportation business and general aviation

1. Air transportation business includes air transportation, advertisement, marketing, sale of air transportation products on the market for profit purposes.

2. General aviation includes the following activities:

a/ General aviation for commercial purposes, which means activities of providing general aviation services, advertising, marketing or selling general aviation services on the market for profit purposes;

b/ General aviation for non-commercial purposes, which means general aviation in service of activities of organizations and individuals for non-profit purposes.

Article 3.- Agencies examining dossiers of application and granting licenses and certificates

1. The Civil Aviation Administration of Vietnam, an agency of the Ministry of Transport, shall examine dossiers of application for air transportation business licenses, general aviation business licenses, general aviation registration certificates, investment certificates for foreign investment projects in the domain of air transportation business, and investment certificates for foreign investment projects in the domain of general aviation business.

2. The Minister of Transport shall grant, as authorized by the Prime Minister, air transportation business licenses and investment certificates for foreign investment projects in the domain of air transportation business.

3. The director of the Civil Aviation Administration of Vietnam shall grant general aviation business licenses, investment certificates for foreign investment projects in the domain of general aviation business, and general aviation registration certificates.

Article 4.- Investment certificates for foreign investment projects

1. An investment certificate for a foreign investment project is concurrently an air transportation business license or general aviation business license, as the case may be.

2. The conditions, order and procedures for the grant of investment certificates specified in Clause 1 of this Article are also applicable to the grant of air transportation business licenses and general aviation business licenses defined in this Decree.

Chapter II

CONDITIONS FOR GRANT OF AIR TRANSPORTATION BUSINESS LICENSES AND GENERAL AVIATION BUSINESS LICENSES

Article 5.- General requirements

1. Enterprises applying for air transportation business licenses or general aviation business licenses must satisfy the conditions specified in Clause 1, Article 110 and Clause 2, Article 198 of the Law on Civil Aviation of Vietnam and the specific conditions specified in this Decree.

2. If airlines that have been granted air transportation business licenses apply for general aviation business licenses, they are only required to satisfy the relevant conditions specified at Point a, Clause 1, Clause 2, Article 6, and Article 9 of this Decree.

Article 6.- Plans to assure the availability of aircraft for operation

1. A plan to assure the availability of aircraft for operation in five years after the planned date of business commencement must specify the following:

a/ Quantity and type of aircraft;

b/ Mode of possession (purchase, hire-purchase or lease);

c/ Plan on operation, maintenance and human resources to operate and maintain aircraft;

d/ Capital source to assure the possession of aircraft;

e/ The number of aircraft dry-leased by the end of the third year of operation must account for not more than 30% of the fleet.

2. The age of used aircraft imported into Vietnam is specified as follows:

a/ For aircraft for passenger transportation: The age of an aircraft of this type must not exceed 10 years, counting from the date of manufacture to the time of import into Vietnam under a purchase or hire-purchase contract; or must not exceed 20 years, counting from the date of manufacture to the time of expiration of a lease contract as stated in that contract;

b/ For aircraft for transportation of cargoes, postal parcels and items and engaged in general aviation for commercial purposes: The age of an aircraft of this type must not exceed 15 years, counting from the date of manufacture to the time of import into Vietnam under a purchase or hire-purchase contract; or must not exceed 25 years, counting from the date of manufacture to the time of expiration of a lease contract as stated in that contract;

c/ For aircraft other than those specified at Points a and b, Clause 2 of this Article: The age of an aircraft of this type must not exceed 20 years, counting from the date of manufacture to the time of import into Vietnam under a purchase or hire-purchase contract; or must not exceed 30 years, counting from the date of manufacture to the time of expiration of a lease contract as stated in that contract.

Article 7.- Conditions on organization of the apparatus to assure the operation of aircraft, air transportation business or general aviation business

1. Having a management apparatus capable of supervising the operation and maintenance of aircraft, flight training, ground operation; development of products, marketing and sale of air transportation services; and a financial payment system.

2. Persons in charge of activities specified in Clause 1 of this Article must have appropriate professional certificates issued or recognized by the Ministry of Transport.

Article 8.- Legal capital

1. Legal capital for an airline engaged in air transportation business is prescribed as follows:

a/ If it operates between 1 and 10 aircraft:

- VND 500 billion, for enterprises also engaged in international air transportation;

- VND 200 billion, for enterprises only engaged in domestic air transportation.

b/ If it operates between 11 and 30 aircraft:

- VND 800 billion, for enterprises also engaged in international air transportation;

- VND 400 billion, for enterprises only engaged in domestic air transportation.

c/ If it operates more than 30 aircraft:

- VND 1,000 billion, for enterprises also engaged in international air transportation;

- VND 500 billion, for enterprises only engaged in domestic air transportation.

2. Legal capital for enterprises engaged in general aviation business: VND 50 billion.

Article 9.- Contents of business plan and product development strategy

1. Demand and development trend of the market.

2. Evaluation of the present status and competitiveness of services provided on the market.

3. Strategy on development of air transportation products and plan on business development in the first five years.

Article 10.- Foreign-invested enterprises

1. Foreign-invested airlines conducting air transportation business and foreign-invested enterprises conducting general aviation business must satisfy the conditions specified in Clause 2, Article 110 of the Law on Civil Aviation of Vietnam and the following specific conditions:

a/ The operation charter must clearly state the number of members of the executive apparatus, of whom foreign members account for not more than one third;

b/ The foreign party owns not more than 49% of the charter capital; or one foreign individual or legal entity owns not more than 30% of the charter capital.

2. The executive apparatus defined at Point a, Clause 1 of this Article is composed of:

a/ Director, deputy director(s);

b/ Chief accountant;

c/ Supervisors in charge of operation and maintenance of aircraft; training of flight crews; ground operation; development of products, marketing and sale of air transportation services;

d/ Other members of the executive directorate as stipulated in the operation charter of the enterprise.

Chapter III

ORDER AND PROCEDURES FOR GRANT OF AIR TRANSPORTATION BUSINESS LICENSES AND GENERAL AVIATION BUSINESS LICENSES

Article 11.- Dossiers of application for air transportation business licenses and general aviation business licenses

1. Applicants for air transportation business licenses or general aviation business licenses shall send dossiers of application to the Civil Aviation Administration of Vietnam.

2. A dossier comprises:

a/ An application for a license that contains the following information: the name, transaction name, location of head office, at-law representative, type, branches and representative offices (if any) of the enterprise;

b/ A copy of the registration certificate of general aviation, in case of application for a general aviation business license;

c/ The list of members or shareholders; nationality and contributed capital portion of each member or shareholder, for partnerships, limited liability companies or joint-stock companies;

d/ A copy of the business registration certificate;

e/ Documents proving the satisfaction of the licensing conditions specified in Chapter II of this Decree;

f/ A copy of the operation charter of the enterprise;

g/ The draft air transportation charter;

h/ Documents certifying the legal status of the owner, shareholders and investors;

i/ A report on the financial capacity of the owner, members of the Members' Council, shareholders and investors;

j/ A competent agency's or organization's certification of or lawful documents evidencing the enterprise's capital;

k/ Copies of professional diplomas and certificates of the supervisors defined in Article 7 of this Decree;

l/ Fee receipts or written certifications

Article 12.- Examination of dossiers of application for air transportation business licenses

1. Within 30 days after receiving a complete dossier of application for an air transportation business license, the Civil Aviation Administration of Vietnam shall examine it and report the results of examination to the Minister of Transport.

2. In the course of examination, the applicant for air transportation business license shall additionally explain relevant matters at the request of the examining agency.

Article 13.- Decisions on grant of air transportation business licenses

1. Within 15 days after receiving results of examination of a dossier from the Civil Aviation Administration of Vietnam, the Minister of Transport shall either report them to the Prime Minister for decision or request the Civil Aviation Administration of Vietnam to re-examine the dossier. The order and procedures for re-examination are as defined in Article 12 of this Decree.

2. Within 15 days after receiving a report of the Minister of Transport, the Prime Minister shall consider the grant of an air transportation business license.

3. Within 5 working days after receiving the permission of the Prime Minister, the Minister of Transport shall grant an air transportation business license.

4. An air transportation business license must contain the following details:

a/ The enterprise's name and transaction name; location of its head office, branch(es) and representative office(s);

b/ Its serial number and date of grant;

c/ The enterprise's charter capital and type; contributed capital portion of each member or shareholder, for partnerships, limited liability companies or joint-stock companies;

d/ Scope and type of air transportation business.

Article 14.- Examination of application dossiers and grant of general aviation business licenses

1. Within 30 days after receiving a complete dossier of application for a general aviation business license, the Civil Aviation Administration of Vietnam shall examine it and issue a decision on the grant.

2. In the course of examination, an applicant for a general aviation business license shall explain relevant matters at the request of the examining agency.

3. A general aviation business license must contain the following details:

a/ The enterprise's name and transaction name; location of the head office, branches and representative offices;

b/ Its serial number and date of grant;

c/ The enterprise's charter capital and type; contributed capital portion of each member or shareholder, for partnerships, limited liability companies or joint-stock companies;

d/ Scope and type of general aviation business.

Article 15.- Notification of grant of or refusal to grant air transportation business licenses or general aviation business licenses

The Civil Aviation Administration of Vietnam shall:

1. Send an air transportation business license or a general aviation business license to the applying enterprise within 3 working days from the date of receipt or grant of the license.

2. Notify in writing the refusal to grant a license to an applicant within 3 working days from the date of receipt of a decision on refusal to grant an air transportation business license or the date of issuance of a decision on refusal to grant a general aviation business license.

Article 16.- Publication of contents of air transportation business licenses or general aviation business licenses

1. Within 30 days after receiving an air transportation business license or a general aviation business license, an enterprise shall publish on a central printed newspaper or an online newspaper for three consecutive issues the contents of its license.

2. When there is a change in the contents of its air transportation business license or general aviation business license, the licensed enterprise shall publish that change within the time limit and by the mode specified in Clause 1 of this Article.

Article 17.- Revocation of air transportation business licenses or general aviation business licenses

1. An air transportation business license or a general aviation business license shall be revoked in the following cases:

a/ The licensed enterprise no longer fully satisfies the licensing conditions;

b/ The dossier of application for the license contains intentionally falsified information;

c/ The licensed enterprise fails to commence its air transportation operation or general aviation within 24 months after it is licensed;

d/ The licensed enterprise ceases its air transportation operation or general aviation for 12 consecutive months;

e/ The licensed enterprise is not granted a certificate of aircraft operator within 24 months after it is licensed, or has its certificate of aircraft operator withdrawn or revoked for more than 12 months;

f/ The licensed enterprise operates for improper purposes or conduct operations other than those stated in its license;

g/ The licensed enterprise intentionally violates the provisions of Articles 16, 18 and 19 of this Decree;

h/ The licensed enterprise seriously violates legal provisions on security, defense, aviation security and safety, air transportation operation or general aviation activities;

i/ The licensed enterprise goes bankrupt or is dissolved.

2. When having its air transportation business license or general aviation business license revoked, an enterprise shall immediately stop its air transportation business or general aviation business activities and deal with all air transportation contracts or general aviation service contracts which were entered into before the revocation of its license.

Article 18.- Enterprise changes subject to approval

1. In case of any of the following changes, an enterprise that has been granted an air transportation business license or general aviation business license shall carry out procedures to request the approval thereof:

a/ It is sold, divided, consolidated or merged;

b/ There is a change in the contents of its air transportation business license or general aviation business license specified in Clause 4, Article 13 or Clause 3, Article 14, respectively.

2. The enterprise shall send a dossier of request for change in its license specified in Clause 1 of this Article to the Civil Aviation Administration of Vietnam.

3. The procedures for examining dossiers and reporting results of examination are as defined in Articles 12 and 14 of this Decree.

4. Within 7 working days after receiving an examination report for a change in the contents of a granted air transportation business license, the Minister of Transport shall, in case of approval of the change, supplement the license or grant a new one or, in case of disapproval, issue a disapproval decision or request the Civil Aviation Administration of Vietnam to re-examine the dossier.

5. In case of approval of a change in the contents of a granted general aviation business license, the Civil Aviation Administration of Vietnam shall supplement the license or grant a new one.

Article 19.- Enterprise changes subject to registration

1. The following changes regarding enterprises that have been granted air transportation business licenses or general aviation business licenses must be registered with the Civil Aviation Administration of Vietnam within 30 days from the date of their occurrence.

a/ Amendments to the operation charter or the transportation charter;

b/ Change of the business registration certificate;

c/ Change of the organizational model as specified in Article 7 of this Decree;

d/ Change of the at-law representative or a member of the executive apparatus.

2. If the changes specified in Clause 1 of this Article are contrary to law, the Civil Aviation Administration of Vietnam shall notify in writing to concerned enterprises for appropriate modification thereof.

Chapter IV

GENERAL AVIATION REGISTRATION CERTIFICATES

Article 20.- Conditions for grant of general aviation registration certificates

1. General aviation registration certificates are granted to organizations and individuals that conduct general aviation activities for non-commercial purposes.

2. Conditions for grant of general aviation registration certificates:

a/ Eligible subjects: Vietnamese legal entities; organizations established and operating under Vietnamese law and headquartered in Vietnam; representative offices or branches of foreign organizations in Vietnam; Vietnamese citizens permanently residing in Vietnam; foreign citizens permanently residing in Vietnam;

b/ Having aircraft in operation;

c/ Having an aircraft maintenance establishment or a service contract with an aircraft maintenance establishment licensed or recognized by the Ministry of Transport;

d/ Flight crew members possess relevant licenses and certificates;

e/ General aviation activities intended to be conducted are relevant to the operation functions of the applying organization, or personal needs of the applying individual;

f/ Complying with national defense and security requirements.

Article 21.- Dossiers of application for general aviation registration certificates

1. Applicants for general aviation registration certificates shall send their dossiers of application to the Civil Aviation Administration of Vietnam.

2. A dossier of application consists of the following documents:

a/ An application for registration of general aviation that contains the following information: The enterprise's name, transaction name, location of head office, at-law representative (for organizations) or full name, date of birth, nationality, serial number of identity card or passport, signature and place of residence (for individuals); type of aviation activities to be conducted; airport or airfield expected to be the base for aircraft; quantity, type and registration mark, form of possession (purchase, hire-purchase or lease) of aircraft in operation; full names, dates of birth, nationalities, serial numbers of identity cards or passports, places of residence, serial number and dates of grant of aircraft flight licenses of flight crew members;

b/ Copy of the establishment license, operation license or business registration certificate (for organizations); copy of the identity card or passport (for individuals);

c/ Copy of the permit for residence in Vietnam (for foreign citizens residing in Vietnam); copy of the permit for setting up a Vietnam-based representative office or branch (for representative offices and branches of foreign organizations);

d/ Copies of registration certificates of nationality and certificates of airworthiness of aircraft;

e/ Plans on aircraft operation and maintenance;

f/ Copies of relevant licenses and certificates of flight crew members;

g/ Copy of the operation license of the aircraft maintenance establishment; copy of the contract on hired maintenance of aircraft, in case of hired maintenance services;

h/ Fee receipts or written certifications.

Article 22.- Examination of dossiers of application for and grant of general aviation registration certificates

1. Within 30 days after receiving complete dossiers of application for general aviation registration certificates, the Civil Aviation Administration of Vietnam shall examine them and decide on grant of or refusal to grant general aviation registration certificates after obtaining the consent of the Operation Department of the Ministry of Defense.

2. In the course of dossier examination, applicants for general aviation registration certificates shall additionally explain relevant matters at the request of the examining agency.

3. A general aviation registration certificate contains the following details:

a/ The enterprise's name, transaction name, location of head office and at-law representative, for organizations;

b/ Full name, date of birth, nationality, serial number, place and date of issuance of identity card or serial number, place and date of issuance of passport, and place of residence, for individuals;

c/ Its serial number and date of grant;

d/ Type of general aviation activities to be conducted;

e/ Airport or airfield expected to be the airbase for aircraft;

f/ Quantity, types and registration marks of aircraft in operation.

Article 23.- Revocation or modification of general aviation registration certificates

1. A general aviation registration certificate shall be revoked in the following cases:

a/ Its holder no longer fully satisfies the conditions for grant of registration certificate;

b/ Its holder operates for improper purposes or conducts operations other than those stated in the registration certificate;

c/ Its holder seriously violates the provisions of law on general aviation;

d/ Its holder conducts general aviation activities affecting security, defense, public interests and social order;

e/ Its holder intentionally uses false information in the registration dossier;

f/ Its holder no longer exists, for organizations, or dies or loses his/her civil act capacity, for individuals.

2. If organizations or individuals that have been granted general aviation registration certificates and wish to modify contents of their certificates, they shall make and send dossiers of request for modification to the Civil Aviation Administration of Vietnam.

3. Modified contents, and the order and procedures for examination and grant of modified general aviation registration certificates are as defined in Article 22 of this Decree. In case of approval of modifications, the director of the Civil Aviation Administration of Vietnam shall supplement certificates or grant new ones.

Chapter V

IMPLEMENTATION PROVISIONS

Article 24.- Application to enterprises engaged in air transportation business; organizations and individuals conducting general aviation before the effective date of this Decree

Within one year after this Decree takes effect, enterprises currently engaged in air transportation business or general aviation business activities, organizations and individuals conducting general aviation for non-commercial purposes shall carry out procedures for applying for air transportation business licenses, general aviation business licenses or general aviation registration certificates, as the case may be, under the provisions of this Decree.

Article 25.- Implementation effect

This Decree takes effect 15 days after its publication in "CONG BAO."

Article 26.- Organization of implementation

Ministers, heads of ministerial-level agencies, heads of government-attached agencies, and presidents of provincial/municipal People's Committees shall implement this Decree.